[Redacted] – I set a 2013 revenue goal for Brent Ozar Unlimited this year, and we made it! I’m not sharing the goal publicly yet, but I’ll circle back in a couple/few years and blog about it in my Life Quest category. Completed 2013.

It’s been a few years now, so let’s un-redact that: the company hit one million dollars per year of revenue.

To be specific, this wasn’t for the calendar year of 2013 – when managing a quickly growing company, you watch revenues over a running 12-month period. We did indeed have >$1mm for calendar year 2013, but we hit this achievement earlier than 12/31/2013. We hit it earlier in the year when there were only four of us doing consulting – me, Jeremiah, Jes, and Kendra.

How do consulting companies hit a million dollars of revenue?

The Brent Ozar Unlimited team, circa 2013

For consulting companies, there’s three common ways to increase revenue:

1. Increase inventory – hire more consultants, minimize the amount of non-billable stuff they do, and make them work more hours. You, dear reader, know that our company philosophy focuses on a good work-life balance, so that last option wasn’t going to happen. We started by hiring Jes, and then after hitting the $1mm mark, we added inventory with employee #2, Doug Lane.

2. Increase the effective billing rate – sell time in blocks of days rather than hours, focus on adding as much value for clients as possible, and sell productized services: fixed-price packages rather than hourly work. For the first few years of the company, we experimented with several different kinds of services – project work, architecture, data warehousing, cloud, Hadoop, and even Oracle. Within a year of hitting the $1mm mark, we focused our offerings down to just one: our SQL Critical Care®. We made a profit on that product by giving clients a huge amount of value relative to what they paid, but it wasn’t like we could charge $1,000 per hour for this product. If we wanted to scale revenue higher, we needed a different route.

3. Sell things not tied to hours – non-consulting products like books, videos, training classes, applications. This looked like a pretty good growth route for us (in addition to scaling up the staff quantity), so in 2013, we started selling online SQL Server training. The idea is that you put in time to build and record the training videos, and then over time, they keep selling and providing you with income that isn’t tied to the number of hours you spend at the keyboard.

What we did isn’t the only right way – there’s lots of consulting companies that make different choices along the way and do a great job of scaling. I’m proud of the way that Jeremiah, Kendra, Jes and I took our route together, though.

Yeah, I went back and forth about calling it that here. Some people define “passive income” as requiring zero additional work to make money as you scale. Selling the training resources online and in-person does require additional work, but the work is really small relative to the amount of revenue. (For example, this morning I put in about half an hour answering questions from online training customers.) I call this passive income, though, and I’m glad you used that same term!

You have made yourselves a Million but you have made us (a reader and follower) more than just a million(via tools such as Blitzindex), maybe you should count that too. Millions and millions across the SQL profession for all of us. Creating efficiency is big business dude congratulations.

I basically measure my success by the number of people I can help each day. How can I make sure that with an hour’s worth of work, I can make a difference in as many lives as possible? I’m all about that, even beyond the financial numbers.